Debt refinancing: C&I Leasing to float N10bn bond

C & I Leasing Plc has perfected plans to raise N10 billion from the capital market through bond issuance for debt refinancing and to boost capital structure.

The company’s Managing Director/Chief Executive Officer, Mr. Andrew Otike-Odibi disclosed this on Wednesday, at the H1 2020 results/outlook for the H2 2020 webinar.

Otike-Odibi said the company’s immediate plan was to raise capital via bond issue of N10 billion to N13 billion.

Otike-Odibi said the proposed bond had been approved by the company’s board and would hit the market very soon.

He noted that the company was also considering an equity raising, and if approved by the board, would be in 2021.

According to him, the company will come out with the right finance mix and will raise equity from its shareholders by 2021.

Speaking on COVID effects and the way forward, Otike-Odibi said the company would develop human capital in line with the opportunity that came out from the lockdown (working remotely).

He stated that the company would invest in human capital development to enhance growth.

The managing director said that the company would seek opportunities for growth to improve visibility to customers and potential business partners.

He noted that the COVID-19 pandemic had changed a lot of things in the last six months.

Otike-Odibi assured investors and shareholders that the company would make proper use of opportunities created by the pandemic.

He said the company would create new businesses from the array of opportunities that came out from the pandemic.

“We are looking to do a lot more in the digital space, to take advantage of the potentials created by COVID-19.

“We have a number of things we are looking at to deliver value to clients and shareholders over the next few months,” he said.

On H1 2020 key result highlights, he said its gross earnings dropped by 5.9 percent to N15.3 billion against N16.3 billion achieved in the comparative period of 2019.

He attributed the decrease to the effect of COVID-19 and the slide in oil price.

 Otike-Odibi explained that most clients requested price reduction in services provided by the company, especially the international oil & gas companies, and local logistics as well as outsourcing companies.

Its net operating income stood at N3.8 billion compared with N4.6 billion posted in H1 2019.

Also, profit after tax was down by 69.1 percent to N268 million in contrast with N866.9 in the corresponding period last year.

The company posted year to date growth in total assets of 5.9 percent to N59.5 billion, against N56.2 billion in full-year of 2019.

The managing director said it was largely driven by growth in cash and balances with banks due to proceeds from the rights issue, operating lease asset, and other assets.

Also speaking, Mr. Alex Mbakogu, Executive Director / Chief Financial Officer, said the company’s source of funding as well diversified.

Mbakogu said it cuts across banks, commercial papers (CPs), and other non-fixed income (CPs).